The shares of Jammu & Kashmir Bank fell nearly 20 per cent to a month-low of Rs 47.60 on the BSE. On NSE also, the shares of J&K Bank plummeted about 20 per cent to a lower circuit of Rs 47.55. The bank’s shares had opened at Rs 49.10 on NSE. The Jammu and Kashmir government on Saturday removed J&K Bank Chairman Parvez Ahmad Nengroo on account of unlawful activities. Following the allegations, the Anti-Corruption Bureau carried out a raid at the lender’s corporate office in connection with alleged fraudulent appointments.
The government appointed the bank’s executive president R K Chibber, as an interim chairman of the bank. It said that the decision to remove Ahmad was part of long term measures for improving the functioning of the bank in accordance with the RBI guidelines.
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“As a first step, the Government has decided to change its nominee Director on the Board of J&K Bank, Parvez Ahmed, who is also the Chairman and Managing Director. Consequent to his replacement as a government-appointed Director, the Board has taken on record cessation of Directorship of Parvez Ahmed as Chairman and Managing Director,” the spokesman had said.
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Ahmad has been accused of corruption and nepotism. He favoured politicians by offering loans worth crores to people recommended by them and he gave his relatives plum positions. He even diverted funds meant for the bank’s corporate social responsibility (CSR) initiative for the beautification of Royal Spring Golf Course. According to BSE filing, the J&K Bank will hold a conference call with investors today.